Memecoins Get New BitMEX Basket Index for Simpler Trading

The MEMEMEXTUSDT contract by BitMEX offers a streamlined way to trade meme coins with significant leverage.

Pepe sitting happy on his pot of coins.
Created by Kornelija Poderskytė from DailyCoin
  • BitMEX introduces a new index contract for memecoins.
  • Aims to a simpler and more secure memecoin investing. 
  • Memecoin traders lost millions to rug pulls this year. 

Memecoins have seen a significant rise this year, fuelled by growing retail investor enthusiasm. For instance, in just a year after its launch, Solana-based Pepe memecoin rose 16000% to a $4 billion market cap. 

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With the growing appetite for memecoins, exchanges are increasingly looking to tap into that market. Most recently, BitMEX launched a basket index fund that tracks the biggest memecoins. The product aims to offer a safer and simpler way to trade memecoins. 

Memecoins are becoming so popular that crypto exchanges increasingly cater to that investor segment. On Thursday, July 4, BitMEX launched the MEMEMEXTUSDT Basket Index Perpetual Swap Contract. This contract aggregates the top 10 meme coins by market capitalization into a single index, aiming to make trading simpler.

Stephan Lutz, CEO at BitMEX, the reasoning behind the product. “Meme coins have seen incredible growth over the past year, and we’ve noticed a growing appetite from BitMEX users to get in on the action,” he revealed. 

However, the choices for users can be “overwhelming, making it tricky for traders to find their footing,” Lutz explains. For that reason, the memecoin basket fund enables traders to “easily diversify their exposure across the top meme coins” and capitalize on the trends. 

The basket index only tracks the biggest tokens, protecting traders from frequent scams and rug pulls. 

Memecoin Traders Risks Scams, Rug Pulls

Despite their growing appeal, memecoins have also attracted significant controversy. The biggest issue is with teams launching a vast number of low-quality tokens. In many cases, as soon as these tokens take off, their teams dump the liquidity and abandon the project

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The issue became so severe that even major crypto industry leaders warned of the risks of memecoin trading. For instance, Solana Founder Anatoly Yakovenko urged investors not to buy memecoin presales, suggesting a high risk for fraud. He suggested that they should back crypto startup tokens. 

Despite his warnings, memecoins still have a large following, which is unlikely to stop “aping” into the supposed next big thing. With memecoins likely here to stay, basked funds at least provide a safer option. 

On the Flipside

  • The fund will only track the ten most popular memecoins at any time. This means that traders won’t benefit from early-stage opportunities. 
  • Even large memecoins are incredibly volatile and risky, depending entirely on the hype surrounding them. 

Why This Matters

The memecoin fund enables traders to get exposure to these assets, without actively managing their portfolios. It also protects investors from rug pulls many early-stage tokens see.

Read more about the dark side of memecoin launches: 
Solana Memecoin Investors Lost Millions on Abandoned Projects

Read more about Solana’s latest performance: 
Solana Leads Crypto Market Crash as Technicals Turn Red

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.